Novak: Selling gold “by the ton” indicates that Russia’s other liquid reserves have been exhausted
10 August 20:11
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Andriy Novak, chairman of the Committee of Economists of Ukraine, stated that the sale by the Central Bank of Russia of a record 22 metric tons of gold may indicate that the country’s other liquid gold and foreign exchange reserves—foreign currencies and securities—have effectively been depleted. He made these remarks in an interview with the "Komersant Ukrainian" YouTube channel.
According to the economist, the state’s gold and foreign exchange reserves consist primarily of foreign currencies and securities, while precious metals are one of the supplementary components.
“What does selling gold mean? It means that everything that goes into those reserves—foreign currency and securities—is almost entirely depleted in Russia. So they are forced to turn to the last bastion of their gold and foreign exchange reserves: gold. And, let me remind you, in their latest sale, they sold 22 metric tons of gold. This means they have nothing else left—neither securities nor foreign currencies from various countries,” Novak explained.
According to the economist, the depletion of reserves, combined with falling revenues and high government spending, could create serious problems for Russia as early as the budgeting process for next year.
“They don’t have the resources to make it through the rest of this year. And when they start drafting Russia’s 2027 budget, they’ll realize there’s nothing to base it on, because there’s no revenue. Spending is out of control, and there are no reserves,” the economist stated.
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